How Goldman Sachs Made $1 Billion On Pig Innards Yesterday

pigfarm tbi

Goldman made nearly one billion dollars yesterday when a pharmaceutical company, Shenzhen Hepalink, debuted on the China’s Shenzhen exchange and instantly skyrocketed 18% in value.

Goldman’s initial investment, $4.9 million, purchased 12.5% of Hepalink or 45 million shares of the company in 2007 (Bloomberg) that are now worth $1 billion.

Yesterday was also a fantastic day for Li Li and Li Tan, who founded Hepalink in 1998 and still hold a combined stake of 72%. Li Li, a former factory worker, became the richest man in China yesterday (Telegraph). He kicked off former #1 Wang Chuanfu, the chairman of carmaker BYD.

Li Li

The company’s rapid success is all thanks to the company’s star drug, Heparin.What the heck is Heparin? It’s a material used for blood thinner that is extracted from pig guts. Labs purify Heparin from the intestines and then it’s put into a shot that helps prevent stroke-causing blood clots in patients with heart conditions or in those undergoing surgery.

Simple and life-saving! And you thought Dendreon was cool.

Li Li must have run into Heparin while working at a state-owned meat processing company. It was first discovered in 1916 and apparently you can also get it from cow lung. Nerdy details from wikipedia: Heparin has the highest negative charge density of any known biological molecule. 

This may qualify for spot among the greatest trades of all time.

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